Federal Reserve Chairman Ben S. Bernanke on Friday laid out a case for the central bank to take further action to bolster growth, citing the risks of prolonged high unemployment and a U.S. economy slipping into a deflationary spiral.
In a much-anticipated speech in Boston, Bernanke did not spell out details of how and when the Fed would take action. But the first option that he mentioned was a program of buying additional assets, namely government bonds, in an effort to drive down long-term interest rates and stimulate economic growth.
The central bank is widely expected to announce such a program, known as quantitative easing, at the conclusion of its next policymakers' meeting on Nov. 2 and 3.
"There would appear to be a case for further action," he said at a conference sponsored by the Federal Reserve Bank of Boston.